He The country risk of Ecuador continued to fall, and it has been following that trend for a week now. While on March 1, it was set at 1859 points, Due to the intention of the National Assembly, led by UNES legislators (correístas), to initiate a political process against President Guillermo Lasso and the threat of protests by the indigenous sector, this On March 9, the indicator settled at 1,585 points.

In this way, the country’s risk is calculated in one week, an indicator that measures the risk that the country will not meet its external debt obligations, which JP Morgan, fell by 274 points.

He The risk of the Ecuadorian country, which is significantly above the risk of its neighbors and is the third highest among the 17 countries of Latin America. While Peru has 197 points, Colombia reaches 405 points. Access to resources on the international market is possible for neighboring countries. On the other hand, access to credit for Ecuador is, despite the decline, unfeasible.

He Minister of Economy and Finance, Pablo Arosemena, He explained that the country risk is the result of political uncertainty in the medium term, with regard to who will be the next government (which could seek a debt default), as instead the economic indicators are positive.

For its part, the Fiscal Policy Observatory said in an open letter to the country that political instability generates a weakening of democracy and worsens the country’s institutional decay. It also reduces job creation by increasing the risks of investment and apparently nullifies the prospects for economic growth. It also ensures that, in the face of irrational demands such as those heard to “bring in international reserves to invest in the country”, the strength of dollarization and the financial system could be contaminated.

In addition, they indicated that billions of dollars are needed to cover the fiscal deficit and the maturing of contracted debts, all of which require large external and internal financing that will be very difficult to obtain in this environment of political violence. Let us remind you that the fiscal deficit (official data) exceeds 2,700 million dollars, and the financing needs are around 7,000 million dollars.

The Fiscal Policy Observatory warned “with deep pain about the catastrophic consequences of political irrationality and demands urgent changes in attitudes in favor of creating a prosperous Ecuador, which is only possible with the effort and discipline of all sustained over time”.

Country risk since President Lasso came to power has had ups and downs, determined by political fluctuations. According to the historical series published by Invenomica, when he took office, On May 24, 2021, I was at 714, This represented a significant reduction in risk due to market jitters due to the uncertainty of the very close election that revealed the possibility of a victory for the Correísmo candidate Andrés Arauz. Country risk remained at these levels for several months. Even On March 10, a year ago, this indicator was 772 points.

However, it rose significantly in June in parallel with announcements of indigenous protests and later when violent protests took place. So while it is On June 1, it was 796 points, and on the 30th of the same month, it increased to 1165 points.

On July 15, despite the beginning of the dialogue tables, the indicator continued to grow rapidly and was already at 1,600 points.

A new jump in risk has occurred October, which reached 1,945 points. This may be related to the moment in which the agreements with the indigenous sector were evaluated, the proximity of the elections and the situation in the prisons. The following months remained high, but in decline.

Therefore, On January 19, 2023, the lowest risk was recorded this year and amounted to 1,043 points. This panorama changed after the elections on February 5, when the indicator rose again due to the poor result of the sectional elections and the political setback that meant for the Government the loss of popular consultation. Thus, on February 7, they were at 1,514 points.

The new episode that led to the increase was the issue of impeachment, which subsided, given the report on the alleged political responsibility of the president in corruption networks, which international analysts assessed as weak and subjective, and which was transferred to the commission of inquiry, led by the representative Mireya Pazmiño, who was from Pachakutik and now votes with correístas.

This March 10, the President of the Assembly, Virgilio Saquicela, together with other members of the assembly from different political groups, however, hinted that the impeachment of the president will take place, since the report that was tested last week, and the second is the impeachment.